In South Korea, the tendency of 'equal income marriages', where husbands and wives have similar incomes, is relatively weak, and the proportion of single-person households and single-parent households is lower than in major countries.
It is estimated that these characteristics of marriage and household structure lowered the level of household income inequality in Korea by 10%.
Park Yong-min, deputy head of the Bank of Korea's Economic Research Institute and Monetary and Monetary Research Department, and Heo Jeong, researcher of the Stability Analysis Team at the Bank of Korea's Financial Stability Bureau, reported today (19th) 'The Effect of Same-Grade Marriage and Household Structure on Household Income Inequality: Focusing on International Comparison' (BOK Economic Research ) stated that:
According to the report, as a result of analyzing the Gini coefficient for each stage of household income formation in major countries, Korea's individual earned income Gini coefficient was 0.547, higher than the average of major countries (0.510), but the Gini coefficient of household earned income was 0.361, lower than the average of major countries (0.407).
The Gini coefficient is a measure of the level of income inequality, and values closer to 0 indicate greater equality and values closer to 1 indicate greater inequality.
When a high-income individual meets a low-income individual to form a middle-income household, the reduction in income inequality at the household level compared to the income inequality at the individual level is called the 'intra-household income sharing effect'. It means big.
Park Yong-min, deputy director, explained, "Korea's trend toward same-income marriages is weaker than that of major countries, and the household structure is also favorable to reducing inequality thanks to the relatively low proportion of single-person households and single-parent households compared to major countries."
According to the report, the rank correlation coefficient and correlation coefficient between the couple's earned income were close to 0 at 0.03 and 0.06, respectively.
This was the lowest among the 34 countries analyzed, ranking 33rd and 32nd, respectively.
In addition, the same-income marriage index, which measures how frequently households with similar marital incomes are observed compared to random marriages, was 1.16 times, the lowest among the analyzed countries (average 1.60 times).
South Korea's tendency to same-income marriage is weak. Although there are many marriages between high-income men and women in Korea, heterogeneous marriages such as marriages between high-income men and non-employed/low-income women, and marriages between low-income/non-employed men and women with middle-income or higher incomes are relatively higher than those in major countries. because it happens frequently.
Deputy Director Park said, “The reasons for the weak trend of same-income marriages in Korea are that low-income household subsidies are low, so there is a strong division of labor within households, with high-income men focusing on economic activities and wives dedicated to housework and childcare. "There are opinions that it is because of women's career interruption due to pregnancy and childbirth after marriage, but there is no verified hypothesis yet."
The share of single-person households and single-parent households in Korea was also 14.7% and 4.0%, respectively, as of 2019, lower than the averages of major countries (22.6% and 7.4%).
According to the report, as a result of the simulation, if Korea's income homogeneity and household structure were the same as those in major countries, Korea's household equalized earned income Gini coefficient was estimated to increase by 10% from the original 0.361 to an average of 0.396.
Deputy Director Park analyzed, "Korea's trend of same-income marriage and household structure favor the effect of income sharing within households, suggesting that rather high inequality in the labor market and insufficient government redistribution policies are complemented."
At the same time, he suggested, "Given that there is a possibility that future trends in income homogeneity and household structure will change in an unfavorable way to reduce inequality, policy efforts are needed to reduce labor market inequality and establish public inequality mitigation mechanisms."